Dutch foundation fabricator Sif may be forced to lay off temporary staff should it not secure further contracts in offshore for 2018.
The company, which has 363 “flexible employees”, said in annual results it has also “agreed suitable arrangements” with its banks to cover a potential “lower level of activity”.
Sif has an order book of 115 kilo tonnes for 2018 with a further 70 kilo tonnes under “exclusive negotiations”. The company has the capacity to produce 300 kilo tonnes annually, it said.
“We are seeing a high utilization of the production capacity in the first months of 2018 and have even had to contract-out some of the production in order to prevent delay damages due to late delivery,” said outgoing chief executive Jan Bruggenthijs.
“We have drawn-up contingency plans that include the (temporary) reduction of the flexible labor pool and the carrying out of overdue maintenance to minimize the consequences of underutilization of capacity during the second half of the year in case the project for which we recently entered exclusive negotiations does not materialize into a contract.
“In view of the current uncertainties, it is too early to issue a forecast for the whole of 2018.”
Overall, Sif recorded revenue of €327.2m, down from €400m in 2016. This was due to lower levels of outsourced work in 2017, it said.
Normalised EBITDA stood at €57.1m down from €65.4m due to set-up expenses related to the new assembly plant in the Netherland.
The company also blamed “inefficiencies related to the coordination of the Roermond and Rotterdam production flows, rearrangement of the Roermond production facilities for base-products for Maasvlakte 2 and late arrivals of new rolling and welding equipment”.
However, production increased to 232 kilo tonnes in 2017, from 191 kilo tonnes in 2016, 90% of which was for offshore wind. Full time staff stood at 252, up from 223.
Image: Maasvlakte 2 (Sif)
Sif plans for tough 2018
By EBS